Spain to send delegation to Bolivia - 3 May, 2006 - News

Spain will send a delegation to Bolivia for discussions following the Latin American country's move to nationalize its hydrocarbons resources, a government official said Wednesday.

Foreign Minister Miguel Angel Moratinos agreed to send the "political and technical" team during a telephone conversation he had with Bolivian President Evo Morales early Wednesday, top aide Bernadino Leon told the leading Cadena SER radio.

Morales' nationalization plan seriously affects foreign companies, such as Spanish-Argentine energy company Repsol, which along with Brazil's Petrobras, is Bolivia's biggest foreign investor, having invested more than Ђ 1 billion (US$1.2 billion) since 1997.

"What we know does not augur well," said Leon. "But we hope that the process will allow companies to stay in Bolivia in a reasonable manner."

He said the delegation would travel to Bolivia in the next few days.

Morales chose Labor Day, May 1, to order companies to sign new operating contracts within 180 days or leave Bolivia. He ordered the military to take control of 56 exploration and production fields, as well as two refineries owned by Petrobras.

Leon said Spain would "act firmly and prudently" but added the "ball was now in Bolivia's court."

Bolivia demands foreign companies turn over most production control to its cash-strapped state-owned oil company, Yacimientos Petroliferos Fiscales Bolivianos. Foreign companies also were told that their production would be turned over to YPFB for sale and industrialization, affecting mostly Repsol and Petrobras, reports the AP.